Property Securities (Australia): No style bias a winner for ING

With no style bias in its investment equation, ING Investment Management (ING) has maintained its position in the market, according to ING director real estate securities, Justin Blaess.

The ING Wholesale Property Securities Trust has no bias towards defensive or growth, Blaess said.

“If you’re deemed defensively bias, you would have expected to outperform over the last two years … if you’d been growth bias, you would have outperformed in the bull market prior to that.

“We actually maintained our position, in the bear market last year and the bull market prior to that,” Blaess said.

Despite a challenged market and an index return of -57.6, the ING trust has outperformed its benchmark on one year by 930 basis points.

“The objective of the fund is to provide a risk profile similar to the [S&P/ASX LPT 200] index, to provide that similar risk profile but superior returns.”

“We’ve been consistently in the first quartile for the last four years.”

Blaess said ultimately people want to invest with managers that are going to provide them with proven success returns, “and consistently deliver those success returns”. He also puts the trust’s good performance down to a strong research process.

First priority is value, however, value alone won’t dictate your returns, Blaess said. “If something doesn’t represent value then there’s no point in investing.” But “value alone won’t dictate your returns because stock can be cheap for a reason”. Blaess said the merits of a company are assessed according to strategy and balance sheet strength. “We say qualitative overload,” he said.

“It has to date delivered the results for us.” Finalists in this category were BT Investment Management and RREEF Alternative Investments.

BT head of listed property trusts Peter Davidson said the BT Wholesale Property Securities Fund was around 5 per cent ahead of its underlying benchmark on one year.

“That reflects the combination of owning some of the better stocks, being opportunistic in our investment style and also avoiding some of the worst pitfalls the sector’s been presented with,” Davidson said.

Meanwhile, RREEF Alternative Investments credits its position as a finalist to the breadth and scope of its global resources.

According to RREEF real estate securities Australia portfolio manager, Ross McGlade, its rigorous investment processes remain fundamentally unchanged during the financial crisis, however, “we have been much more aggressive in forecasting a trust’s distribution, which impacts on a stock’s ranking in our universe”.